Money laundering concerns in any industry are not to be trifled with. It is evident any business model relying on payments is susceptible to such criminal activity. If The Daily Beast is to be believed, Airbnb may have a Russian money laundering problem. That is a rather disturbing development on multiple levels.
AirBnB And Money Laundering by Russians
It is evident the concept of money laundering has changed dramatically over the past few years. While its main principle is still the same, it is more difficult than before to launder money without evoking suspicion. If central banks around the world are to be believed, money laundering is part and parcel with bitcoin and other cryptocurrencies. So far, there is no shred of evidence to back up such claims in any significant capacity.
In fact, banks and other financial institutions remain the main facilitators of money laundering, for all intents and purposes. Surprisingly, they have received a helping hand from Airbnb. This popular, disruptive service has seen an influx of dirty money flowing through it as of late. It would appear scammers from all over the world – but mainly Russians – are leveraging this platform to launder cash from stolen credit cards. That’s a very worrisome development, not just for the company, but for all affected victims.
It is certainly true that criminals will use any method at their disposal to remove any taint of theft from their stolen money, whether physical or digital in form. An investigation of several Russian-oriented crime forums indicates the term Airbnb is mentioned quite often. Anyone can use either a legitimate or a stolen platform account to request bookings and make payments to hosts. Those hosts have the ability to refund a percentage of their profits, even if no one actually stayed at their property during the time period booked.
On paper, this tactic is not entirely illegal. However, once stolen credit cards enter the picture, things go to a whole new level. Some criminals offer to let Airbnb hosts keep up to 50% of the stolen money, which will certainly entice a lot of people to explore this new opportunity. It is unclear how many hosts are participating in this money laundering scheme, but it appears the venture has proven lucrative enough.
It is evident such illicit activity has a better chance of succeeding in Russia than anywhere else. The country has its own set of laws when it comes to carding, credit card fraud, and even money laundering. Moreover, it seems the people participating in this activity – either willingly or unknowingly – haven’t faced any backlash over these fraudulent Airbnb bookings and have gotten away with the money as well. It is a very big problem, although the accommodation service is not the only company being exploited in this way.
The big question is how Airbnb will attempt to tackle this problem moving forward. The company makes 3% from every booking, which means its revenue has gone up quite a bit as of late. However, the mounting number of chargebacks and fraudulent bookings should raise alarm bells as well. The company uses a real-time fraud detection service, but it seems a fair amount of suspicious activity is still getting through. Carding is a very dangerous trend that has been around for as long as e-commerce has existed. Rest assured it will only grow worse over time.